Concerned that it may no longer be too big to fail, Citigroup announced on Monday that it will hire 60,000 lobbyists to replace the more than 50,000 workers it is dropping from its payroll.

Philip Maddocks

Concerned that it may no longer be too big to fail, Citigroup announced on Monday that it will hire 60,000 lobbyists to replace the more than 50,000 workers it is dropping from its payroll.

Citigroup executives said that Vikram S. Pandit, the company’s chief executive, viewed the announcement as a "bold, belt-loosening step forward" that should restore confidence that his company remains too big even as it sheds tens of thousands of workers.

"Now we can lay off another 100,000 workers and still remain the unwieldy, money-losing Goliath we have become," said a company spokesman. "Shareholders can rest assured that Citigroup has not lost sight of the advantages of being too big or too much of a financial failure."

Citigroup, the recipient of $45 billion in government bailout money, is already fielding an army of Washington lobbyists working on a host of issues, including the bailout. In the fourth quarter, it spent $1.77 million on lobbying fees, according to its lobbyists’ filings. But Mr. Pandit, company executives said, had grown frustrated by the slow pace of government rescue money coming his company’s way and worried that Citigroup may have become too nimble and too little of a drag on the economy after shedding about 14 percent of its workforce.

"We needed to do something arrogant and expensive that had no shareholder value and I think we accomplished that," said one company executive. "The only thing we might have done is to have spent a million dollars renovating a bathroom or conference room."

A Citigroup lobbyist pointed out that Citi isn’t the only financial giant out there lobbying. During the last three months of 2008, at least seven other firms receiving bailout funds — American Express, Capital One, Goldman Sachs, KeyCorp, Morgan Stanley, PNC and Bank of New York Mellon — all lobbied the government about the bailout, he said. And the automakers that received billions under the same program lobbied as well: including General Motors; its financing arm, GMAC; and Cerberus Capital Management, the private equity firm that controls Chrysler.

"They can do it; they just can’t do it on the scale of Citigroup," he said. "If Citi was too big to fail before, I can’t imagine how it will be viewed with all these new lobbyists."

K Street reacted favorably to news of Citigroup’s move as purchases of bacon-wrapped shrimp shot up by more than 800,000 pounds.

The financial industry is just waking up to the severity of the market crisis, said one K Street analyst.

"At first, the belief was that the problem was something that could be fixed on Wall Street. Now these companies are realizing that the money is in Washington and the only way to get at it is through K Street," he said.

"This is a great day for free speech and free appetizers," he added.
As Citigroup’s fortunes escalated this week, Mr. Pandit reportedly went on the offensive, working the phones and holding a companywide call to shore up the confidence of anxious professionals on K Street, assuring them that "Citi will never be too broke to hire lobbyists."

Later in the day, the company held a similar call with large corporate customers. On Sunday, Citigroup plans to run full-page advertisements in major newspapers acknowledging that "our financial markets have been tested in unprecedented ways," but arguing that the company has a broad range of lobbyists and enough "too bigness" to pull through. In a nod to the company’s slogan, the text concludes: "That’s why now, more than ever, you can feel confident that Citi never sleeps and, thanks to our team of lobbyists, neither will Washington."

Citigroup’s executives are not expected to sleep much this weekend as they continue to pursue contingency party plans, including what they might need to gain access to the newly renovated office suite that was the work quarters for John Thain, the former chief executive of Merrill Lynch.

"A lot of our new lobbyists want to see what a $35,000 commode looks like," said one Citigroup executive, "and they want to be able to tell colleagues what it feels like to spill a drink on an $87,000 area rug."